Immigration issues (2)

‘Too Many People in Britain? Immigration and the Housing Problem’ is the title of a short paper produced in 2012 by Stephen Nickell an economist and former Warden of Nuffield College, Oxford.

In a short paper he examines the question of immigration and housing. He states that “More people means more houses, more roads, more power stations, more waste incinerators, more airport runways. Most people appear to dislike these things. In particular they dislike housing development.” He points out that demand for housing is driven by growth in population and income.

Turning to the impact of increases in income he states “Even if the number of households were not growing at all, this would require around 150K new homes per annum to be built in England if house prices are not to rise relative to incomes.” We are not convinced by this statement. To suggest that building more houses would somehow lead to house prices remaining stable is very simplistic. As we know not all households are equal in terms of income or wealth. Unless this issue is addressed the impact on house prices of extra housing is minimal. More houses would end up as second homes for example.

The paper then focuses on how to build more homes ignoring the fact that much of the rise in household numbers in the UK is due to high net migration. It is quite common for those arguing the case for more migration to sidestep the issue and move on to other points. This does little to add to the debate!